THE HEALEY ADMINISTRATION on Wednesday proposed a system to segregate, track, and spend the tax revenues that have started to flow into state coffers as a result of passage of the millionaire tax by voters in November.
The system steers all of the money into one fund, the Education and Transportation Fund. Expenditures from the fund – set at $1 billion in fiscal 2024, which begins in July — will be restricted to education and transportation initiatives, with precise spending levels left to the legislative process.
In her budget proposal, Gov. Maura Healey calls for $510 million to be spent overall on education and $490 million on transportation.
The education funding is split between early education and care ($140 million), K-12 education ($10 million), and higher education ($360 million).
The higher education funding includes $20 million for Healey’s MassReconnect program, which offers free community college to residents over 25. Another $59 million is going for a new program that will allow incoming students from Massachusetts at four-year state colleges and universities to lock in what they pay in tuition and fees for all four years.
On the transportation side, Healey is pushing for $100 million for municipal programs, $164 million for state highway initiatives, $186 million for the MBTA, and $40 million for regional transit funding, including $12.5 million for construction projects related to East-West Rail and $2.5 million for water transportation.
The MBTA’s funding includes $181 million for capital investments, including design work for connecting the Red and Blue subway lines at Charles/MGH, and $5 million to launch a system of means-tested fares, which provide a discounted fare to income-eligible riders. An MBTA spokesman said no timetable has been established for launch.
Administration officials said all of the funding is new and not replacing spending pare back elsewhere. For example, the money going for capital investments at the MBTA is separate from a similar size line item for the transit authority, officials said.
Matthew Gorzkowicz, the secretary of administration and finance, said money coming in from the millionaire tax – the administration is calling it Fair Share money – during the current fiscal year will help establish a stabilization balance that will soften shocks as the inflow of funds is likely to vary over time. The stabilization fund will be a third of the annual spending limit, or about $330,000 initially.
Gorzkowicz acknowledged that revenues in fiscal 2024 could exceed $1 billion, and those excess revenues could go for one-time expenditures in education and transportation.
